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In the loop 26 June 2025

In the loop

Shireen Darmalingam

What you should know this morning:

  • The rand is stronger this morning, at R17.69/$, after closing stronger yesterday (R17.75/$*).
  • EM currencies were mixed yesterday; the PHP (+0.8%), MXN (+0.7%) and TWD (+0.5%) were the biggest gainers; the ARS (-1.2%), BRL (-1.0%) and TRY (-0.3%) were the biggest losers.
  • Asian equity markets are mixed this morning; the Nikkei and Shanghai Composite are up, while the Hang Seng is down.
 
  • Conflict in the Middle East: President Trump yesterday commented that the US and Iran would meet next week, following the announcement of a ceasefire earlier this week.
 
  • Fed Chair Jerome Powell’s comments to the Senate Banking Committee echoed sentiments expressed to the House Committee on Financial Services.
  • Powell noted that the Fed is still struggling to determine the impact of tariffs on consumer prices.
  • Powell reiterated his view that the Fed is not in any hurry to continue trimming borrowing costs. 
  • He cited the strong economy and uncertainty over how tariffs may affect inflation.
  • Powell noted that recent economic data is backward-looking, and many expect “a meaningful increase in inflation” over the course of this year due to tariffs.
  • Fed governors Michelle Bowman and Christopher Waller recently signalled that they would support an interest rate cut as early as the July FOMC meeting, if inflation remains subdued.
 
  • President Trump yesterday commented that he has three or four people in mind to succeed Fed Chair Jerome Powell when his term ends in May 2026.
  • Trump did not name the candidates.
  • Trump once again criticised Powell’s decisions as Fed Chair.
  • The president continued with his pressure campaign on the Fed chair to lower interest rates.
  • He has been pushing for rate cuts, saying the central bank is keeping borrowing costs for the US government high. 
 
  • The Q1:25 GDP (third estimate) is expected to come in at -0.2% q/q for Q1:25, unchanged from the previous estimate.
  • The release is expected to reflect an upturn in imports, a deceleration in consumer spending compared to Q4:24, and a downturn in government spending.
 
  • Locally, the May PPI is on the cards today and is expected to come in at 0.5% y/y, matching April’s increase.
  • The BER’s consumer confidence index for Q2:25 is also due; consumer confidence deteriorated to -20 in Q1:25.
 
  • Brent crude is up this morning, and down by 9.0% year-to-date.
  • The gold price is up this morning, and up by 27.1% year-to-date.
 
  • Brent crude oil is currently at $67.93/bbl; ($67.68/bbl*).
  • Gold is at $3334/oz ($3332/oz*).
  • SA CDS 188bps*, Brazil 151bps* and Turkey 304bps*.
  • Yields: US 10yr at 4.29%*, German bund at 2.56%*, SA 10-year generic at 9.97%*, SA’s R2035 at 9.91%*.
 

* Denotes yesterday’s close.

Key events and data: 

  • 10h00: SA BER consumer confidence (Q2:25)
  • 11h30: SA PPI (May)
  • 14h30: US advance goods trade balance (May), GDP (Q1:25), durable goods orders (May), initial jobless claims (21 June)
 

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